Consider the Following Limit Order Book of a Specialist

question 29

Multiple Choice

Consider the following limit order book of a specialist. The last trade in the stock occurred at a price of $40. If a market buy order for 100 shares comes in, at what price will it be filled?

• A) $39.75
• B) $40.25
• C) $40.375
• D) $40.25 or less

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Definitions:

Petty Cash Fund

A small amount of cash kept on hand within a business for minor and immediate expenses.

Internal Control

Initiatives and standards implemented by a firm to assure the correctness of financial and accountancy details, encourage integrity, and obstruct fraudulent activities.

Journal Entries

The method by which all business transactions are initially recorded, using a system of debits and credits, to maintain the financial records of an entity.

Segregation Of Duties

A key internal control that prevents fraud and errors by ensuring that no single individual has control over all aspects of a financial transaction.